German economy
Top economist expects an upturn for summer 2024
Holger Schmieding is chief economist at Berenberg Bank
© Foltin Jindrich / / Picture Alliance
Holger Schmieding once invented the label of the “sick man of Europe”. However, the chief economist at the private bank Berenberg does not share the currently widespread pessimistic view of the German economy
After the decline in recent months, the German economy could grow significantly again in the first quarter of 2024. Comes to this conclusion Holger Schmieding, chief economist at the private bank Berenberg, in an interview with “Capital”. “Production will probably pick up at the beginning of 2024. That is often the first impulse, the mood brightens and everything slowly gets going,” said Schmieding. “This is building up around the world and resulting in an upswing that will probably gain strength from spring onwards. Things could then go really well in the summer.”
Economist Holger Schmieding: “Others envy us for our fiscal problems”
According to Schmieding, the reason for the recession in the second half of the year is an inventory correction that is gradually ending: companies hedged their bets after the previous delivery bottlenecks and then encountered lower demand. By spring at the latest, German companies could expect increasing orders again, also because the overall economic basis is stable: “Others envy us for our fiscal problems,” said Schmieding. “Secondly, our job market has been rock-solid so far.” In addition, the federal government is “taking steps in the right direction today”. “This is different than under the governments of the late 1990s and early 2000s.”
In the economist’s opinion, energy prices, which are often described as a problem, do not stand in the way of an upswing. “Energy prices here have always been above the European average. Relative to many others in Europe, little has changed for German companies,” said Schmieding. He is therefore skeptical about plans for an industrial electricity price: “If it’s about national security, I’d be happy to do so. But to preserve jobs, such an instrument is a complete waste of money.”
This article appeared first at “Capital”.
You can read the entire conversation with Holger Schmieding in the new “Capital”, which will be published on October 21st. Interested in Capital? Here you go Subscription shop, where you can order the print edition. Our digital edition is available in Apples App Storeat GooglePlay – and in our new premium subscription Capital+ under the menu item “Digital Magazine”